Albuquerque Business Daily

How does investing in certificates of deposit help the economy, if at all?

Does investing in CD's help? Does it not help? If so or if not, how does it affect the economy? Thanks, in advance, for all your responses.

Public Comments

1. It doesnt help the economy. How it effects the economy depends on where and when the funds originated. Example if you use the stimulis money created in the last couple of months then that money will cause the money supply (inflation) to increase. On the other hand if you pay off debt with that same stimulis money then that causes a retraction in the money supply. If the money to go into the CD is comming from other savings not invested in the market then it has no effect. But pulling money out of the market gives business less capitol to work with. To understand what Im saying about how money is created and retracted you must google and learn about "fractional reserve banking" then you will understand.